Go ahead, only the goods will

One afternoon two years ago, four Chinese were gathered in the lobby of the Four Seasons Hotel in New York, where four people were talking about the fate of the only thing. Four of them are the Chief Executive Officer (CEO) of Shenya, Chief Financial Officer (CFO) Yangdonghao, and the two venture capital agency representatives of the Limited Products Co., Ltd.

They had to make a decision at the time that they would not allow the goods to be listed in the United States. Representatives of Goldman Sachs, which helped their U.S.-listed investment banks, have told them that the goods could be listed in the United States at a price of $6.5 per share, with a success rate of about 70%. In the United States, because of the crisis in the U.S. because of the caught in financial fraud, this allows the U.S. capital markets to determine only the value of this price. But Goldman Sachs advises that it will "rush".

But if it does, the 6.5-dollar price is too low and the company is valued at around $300 million trillion. The executives themselves knew that the company would soon be profitable. Before , They even wanted to sell at least 8-10 dollars a share. But if it doesn't, it's hard to say when there's a chance to go public again next time.

"Finally decided to go public. Because our senior executives and senior managers of relatives, relatives and friends were in New York, are waiting for the celebration, if not listed will have to tell people that we return to the country, say not export AH. They don't know what the difference is between 6 blocks 5 and 8 5, so this decision is quickly agreed within 5 minutes. Yangdonghao recalls.

This decision, made in five minutes, is a success. Two years later, on March 6, the company's market capitalisation broke 10 billion dollars. And China's Internet industry in the United States and Hong Kong listed companies, the market value of more than 10 billion U.S. dollars of companies, only Baidu, Tencent and Qihoo 360.

NetEase 2013-year market capitalisation also to 10 billion U.S. dollars, and then fell back, only the goods will become China's 5th market capitalisation rushed over 10 billion U.S. dollars of internet companies. Just like NetEase, only the current market value of goods has been toppy to around 7.8 billion dollars (March 25, 2014).

Two years, the company's market value from 300 million U.S. dollars to 10 billion U.S. dollars, the share price from 6 U.S. dollars rose to 180 dollars. It has been profitable for five consecutive quarters and has become the only profitable company in China's current proprietary business. Is this a miracle or a bubble?

Two Wenzhou people Allied

Only products will be mainly two Wenzhou people founded-Shenya and Hong Xiaobo. Shenya do battery agent started, once got all the first-line battery brand Southern Zhejiang regional agent right. Later, he opened a battery factory to do battery export business.

Hong Xiaobo 8-Year-old immigrant in France. Parents in France to do catering and real estate business, I hope he can take over. Hong Xiaobo But borrow money from his father to start a business, operating mobile phone Bluetooth devices and other wireless products, but business is not good.

1998, two acquaintances, began to partner in mobile phone accessories business. Shenya is responsible for the domestic purchase, Hong Xiaobo is responsible for selling goods in Europe. At that time, a 5 yuan mobile phone accessories, in Europe can be sold to 5 U.S. dollars. It was the first pot of gold they had made.

One day in 2007, Hong Xiaobo found that his wife often woke up early in the morning to sign up for the French premium discount website VP (vente-privee.com, hereinafter referred to as "the French VP") to snap up brand discount packages. This year, the United States website gilt The French VP of the business model has been transformed, specializing in luxury sales discount.

Hong Xiaobo found Shenya, proposed can be replicated in China. At that time, two people at the Yangtze River Business School, so from the students to find another two to do the clothing business of Wenzhou fellow--the French group boss Peng and the domestic women's brand European Xu Yu boss, there is a classmate from Hangzhou. Five people together 30 million yuan, jointly launched the establishment of the only product will.

At that time, there have been several brand-name discount model of the electric Dealer website. such as 88brands and VIP special sale. Some of the French were directly founded in China, the model completely copied the French "VP".

Only goods will be online in December 2008, the choice is a comprehensive imitation of gilt luxury flash purchase mode, fixed-time quantitative introduction of discounted luxury goods, snapped up after no longer supply. At the same time only products will be added to the Chinese characteristics-to provide genuine insurance, if consumers buy a fake brand, can get a full refund, hoping to dispel consumer concerns.

Only the goods will be online the month to sell only 18 orders, and most of the Hong Xiaobo and Shenya themselves and friends care business. This state lasted until March 2009.

Capital partner Rei Chenghui, who invested in luxury companies such as the Temple, said to Southern weekend reporters in the 2009, top luxury brands were wary of Internet access, and luxury electric dealers were not getting too much supply, counterfeit luxury goods were rampant in the online shopping market, and consumers didn't believe they could buy real luxuries on the internet.

Only products will soon adjust the positioning of the product, abandoning the top-tier brand, aiming at Adidas, Nike, Casio and other Chinese consumers more familiar with the two or three-line brand, began the only product will be a major transformation.

From selling luxuries to sewers.

April 2009, the women's brand European Time Force (ochirly) announced in the only product will open exclusive network during the special sale. Othli is one of the initiators of the Xu Yu to build a national women's clothing brand.

Only the transformation of the product will be smooth, when the apparel industry every year there are a large number of seasonal products and tail goods inventory through this "sewer" to clean up.

According to the data of the time, 2008 fashion goods (including clothing, shoes, hats, cosmetics, etc.) become the largest Internet users shopping category, especially clothing, trading volume since 2007 more than mobile phone digital products ranked first.

and suppliers specific mode of cooperation, some only goods will buy out, mainly to Nike and Adidas, such as a class of brand operators. Only goods will need advance purchase, sell can not be returned. Most of the merchandise is to sell the model, sold not to return. On the two or three-line brand, only the goods will begin to be required advance, is generally the price of goods about 15%. After large scale, most of them have been paid for, except for suppliers like Nike.

A demand for anonymity of a clothing brand in charge told the south weekend reporters, when only the people found him, said four reasons, one is able to help deal with tail goods and over season products. Second, can help to do some free brand advertising. For example, only products will be on the site to do some SNS and other social marketing. Third, the only product will be limited limit of the special sale mode, will not affect the supplier's offline price system. And the brand can also take some new products to the only product will do some sales testing. Four is the account period is very short, not pressure supplier's payment. So far only goods will still maintain a 1-month accounting period. Most other electric dealers are at least three months old.

"The first reason other electric dealers can satisfy me, but the latter three reasons I can not refuse." Especially the account period. Can do a month back to the money at that time only the goods will be. "The head of the South Weekend reporter recalls that later found that often did not return, because selling too fast." So the final and only goods will be signed an exclusive sales platform for cooperation.

Unlike the vast majority of electric dealers, only in the first two years, no angel investment has not introduced venture capital. It's about the founder. Shenya and Hong Xiaobo are trade-born, with five of their sponsors unrelated to the Internet.

Business in the three or four-line city

Only product will be successful in the future, not only that it initially found a hunger marketing model, into the female consumer-oriented clothing field, more importantly, it was in the consumer mentality to create a quasi "Wall Street Wolf" sales model.

Jordan Belfort, known as the "Wall Street Wolf", started out as a marketing junk in the 1990 's, in the form of making phone salesmen sell their customers Kodak and other blue-chip stocks to win trust, and then sell the junk to make a huge profit.

In 2009, after the transformation of fashion products, the only product will be introduced on the one hand, two or three-line international brands, to a very low discount to attract consumers, on the other hand, with these international brands tied on the shelves is a variety of foreign name of the domestic brand. Only the strong packaging capacity of the product will make these domestic brands appear to have a long history and outstanding reputation.

For example, Ceen this Guangzhou shoes brand, the only product will be introduced is: began in the 1880s in the old Shanghai, developed in the 1940s London, back in the early 21st century of the world leather goods capital-Guangzhou.

For consumers in a first-tier city, such a combination seems quite out of tune. Beijing an IT public relations company of the female students to Southern weekend reporter said, she is a friend from the home for the first time heard that only the goods will, think that selling luxury or one or two line big brands. Later discovered that not only has the international big name, more is in the hometown this kind of small county sells the brand. "The brand span is really very big, the hometown friend said, in the small county, the consumer psychology or pursues the brand name, as long as is opens the store to feel is a big brand." ”

"Most let me depressed, is often branded clothing to attract in, but found that there is no able to see the clothes, like the poster was cheated of the feeling." This is like the sale of special sales to the Internet, can be left to the last discount clothes, it is certainly not the selling money. "she said.

Only the real market is really not in the first tier city. According to its CFO Yangdonghao, only goods will be in the first-tier city orders accounted for only about 13%, while the second-tier capital cities accounted for 30%, or even four-line cities and counties township accounted for more than 20%.

Three or four-line city consumers do not really care about the purchase is not an international brand, Anhui prefecture-level civil servants to the South weekend reporter said, he often in the only goods will buy clothes, once bought a German brand pants, but never to Baidu it is not really a German brand. "After the discount is two hundred or three hundred yuan, quality is also very good, is not an international brand is not important."

In fact, it's not like the "Wall Street Wolf" is selling junk products, but the establishment of a team of more than 600 people (many of them are "Ruili" "Xin Wei" and other fashion magazine editors, as well as the department store women's clothing purchase), the domestic brand is also fine select. In order to provide consumers with a good consumer experience, but also set up a 800-person call center.

The Secret of logistics

After creating such a pattern, the only thing to do is to compress the cost as much as possible.

The two main costs of electricity dealers are advertising and logistics.

Only the goods will cut into the shoes and clothing class after the electric dealer, abandoned the other electric dealers used to burn money to hit the pattern of advertising to buy traffic, maximum retention of the French "VP" and the United States Gilt imitation: focus on limited-limit special selling mode, only sell brand discounts, and adopt a strict membership system, relying on Word-of-mouth marketing does not rely on advertising to do promotion.

Earnings data show that at present only goods will have nearly 50 million members, repeat the purchase rate reached more than 70%, the order has more than 90% of the old customers. In other words, only goods will not need to spend a lot of advertising costs to obtain traffic and new customers. and relying on advertising to get new customers is exactly the place where Internet electric dealers burn money.

Earnings also showed that the company from 2009, marketing costs gradually reduced, to the current accounting for revenue is already under 5%. Many of the peers are around 10%-20%.

In the expense of advertising, only the goods will even want to even the cost of logistics to the lowest, and then some positioning similar brand-name discount electric dealers fail to make the company realize that the logistics of money can not be saved.

At that time, there was a brand discount website called Barbara Brain, the founder of the French, the business model completely copied the French VP company. The result fell in the summer of 2010. Mainly because there is no own warehouse, so that brand operators to do the distribution directly. And the brand is too small site, distribution is not positive, delivery time is long, resulting in consumer returns to return to the explosion, and finally announced the closure.

The special selling logistics system is different from other electric dealers. Short Sales cycle, inventory turnover less than a week. If the delivery time is more than 10 days, it means that the next time the consumer snapped up, did not receive the last product. Who would like to order this time?

"In foreign countries, brand discount distribution is seven days and half a month, but for Chinese consumers, three days not to send the goods to the past, he is likely to ask for a refund of returns." "Tang Tanji, senior vice president of logistics operations, said to Southern weekend reporters.

After two years of establishment, the goods will never be financed. October 2010, aware of the importance of logistics, the company completed the first round of 70 million dollars of financing, to improve delivery speed. At the same time, Shenya recruited Tang Tanji. The supply chain of people in China Resources, Dangdang and other companies, for Dangdang design a complete set of warehousing logistics system.

Only the product will be in the past with many electric companies, like the use of Express company one-stop service. That is, commissioned a number of express companies, from the warehouse to the consumer door one-stop solution.

This mode is more suitable for other electric operators. But the goods will be distribution of most of the fashion women and other users need to try on the goods, some customers try to wear twenty or thirty minutes, courier can not wait. Consumers want to return a replacement, courier also lazy to waste more breath.

After the transformation of logistics system, it becomes the mode of trunk transportation plus landing. From the warehouse to the city trunk transport, only goods will do their own half, outsourcing half. From the city to the door of the landing match, find the best local distribution company. In order to encourage the enthusiasm of the Express company, the company to increase their price to 6.5 yuan a single profit, other electric dealers to the majority of the three or four yuan per single profit.

In addition, the only products will be the landing with the company's courier staff training. For example, customers feel smaller when they try to wear clothes. They teach The courier so answer: "This dress is originally a self-cultivation style, now popular this style, this product is limited time limit snapped up, can rob has been good." Would you like to reconsider? "This greatly reduces the return rate.

At the same time, only goods will give up some orders. For example, Da Hinggan Ling Order a commodity, possible goods in Guangzhou. Such orders will voluntarily give up. Brand products into which warehouse, in which regions and cities on the line of this product, other cities, consumers do not see. Avoid the phenomenon that the consumer will not be willing to send the goods after it has been robbed.

May 2011, only the goods will carry out a second round of 50 million U.S. dollars of financing for the construction of trunk transport network. Tang Tanji For example, Guangzhou to Kunshan shuttle bus, the general social logistics walk a trip, need 42 hours, the price of 15,000 yuan, and only goods will walk, just 28 hours, the price of 12,000 yuan.

The warehouse changed from rent to buying place. Tang Tanji calculate a lump sum account, although invest in early stage, but in the long run is cost-effective. After the IPO in March 2012, the company financed more than 70 million dollars, which were used to invest in warehousing.

The ceiling of the only product

China's clothing tail market is about 400 billion yuan, with less than 5% of its current share, the US investment bank said in an inquiry. In the short term it seems hard to see the ceiling.

Another unnamed person at a foreign investment bank said to Southern weekend reporters that the investment bank maintained a buying rating for the only product. But he believes the company faces a variety of risks, including a growing number of competitors, a shrinking inventory of the apparel industry, and slow layout of the move.

Indeed, only the goods in 2013 to increase a lot of competitors, Beijing-east, Dangdang, Cat, Fank and other electric companies have launched a special selling mode.

Some electric circles insiders told the southern weekend reporters, where the guests in the special sale, if it is consignment products, from the supplier to the Commission is very low, only about 5%. And the Commission is about 15% to 20%. This has left many suppliers to co-operate with customers.

Jingdong on the line called "Red" flash purchase channel, positioning is simply locked only product will. To this end, Jingdong introduced a different account period. namely "t+1" new settlement system, the accounting period will be shortened to "Order completion time + 1 days", even more than the only product will be short.

Previously, suppliers worried that with the Beijing-east such a large platform to cooperate, will disrupt their own online price system, but also disrupt their own in the east of the price system of non-flash purchase products. In this respect, the Jingdong solution is to the flash purchase into a level two domain name, and the main station to distinguish between the user from the home Flash purchase entrance, see is a famous special selling platform.

In addition to the entrance and domain name of the partition, the goods have also done the partition, the brand in the flash purchase of goods and the main station on the goods is not the same, for the main station is not affected by the sale of goods. Jing Dong Open Platform Clothing Division general manager Liu to the southern weekend reporters that the Beijing-East Flash purchase platform also provides brand new products when the trial service.

After the initial high speed development, only the goods will start to slow down. Earnings showed 2012 year-on-year revenue growth of 204.7%, and 2013 to 145.1%.

In order to deal with competition, in February 2014, only the goods will hold the cosmetics vertical electric business Lok Bee Network, expand their category. Le Bee Network of the main market in the first-line city, which is precisely the former unfamiliar and lack of advantages of the battlefield, the two sides can form complementary advantages. And in the United States makeup industry, the only product will also be able to copy their own in the apparel industry model.

At the same time, the only product will also be in 2014 two quarter to vigorously develop the luxury goods electric business. But the situation is not optimistic.

In fact, the imitation object of the only product is now beginning to shake off the dependence on luxury goods and fashionable goods. Early in the 2010, the Gilt website began expanding its product category, extending to wine, resorts and some unknown designer brands. In addition to luxury goods, French "VP" also began to sell many products and even sell seedlings.

For the only product, there is a dilemma: if you follow your own "teacher" to expand the category, it means that there is no difference with other Chinese self-and. If you do not follow, to continue to dig the luxury goods and fashion market, but also faced with the shortage of supply.